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Identifying the causes of low participation rates in conservation tenders

journal contribution
posted on 26.03.2019, 00:00 by John Rolfe, SGM Schilizzi, P Boxall, U Latacz-Lohmann, S Iftekhar, Megan Star, P O'Connor
Conservation tenders are being used as a policy mechanism to deliver environmental benefits through changes in land, water and biodiversity management. While these mechanisms can potentially be more efficient than other agri-environmental and payment for ecosystem service schemes, a key limitation in practice is that participation rates from eligible landholders are often low, limiting both efficiency and effectiveness. In this paper we document and review potential causes of low participation in two categories: those that treat participation as an adoption issue focused on searching for the landholder, farm or practice characteristics that limit participation; and those that treat it as an auction design issue, looking for the different auction, contract or transaction cost elements that limit landholder interest in participation. We then model how landholders make choices to engage and bid in a tender, making three important contributions to the literature on this topic. First, we document the low participation rates in conservation tenders, mostly across developed countries, an issue that has received little attention to date. Second, we explain that a decision to participate in a conservation tender involves three simultaneous decisions about whether to change a management practice, whether to be involved in a public or private program with contractual obligations, and how to set a price or bid. Third, we explain that there are a number of factors that affect each stage of the decision process with some, such as landholder attitudes and risk considerations, relevant to all three. Our findings suggest that decisions to participate in a conservation tender are more complex than simple adoption decisions, involving optimisation challenges over a number of potentially offsetting factors. © 2018 J. Rolfe, S. Schilizzi, P. Boxall, U. Latacz-Lohmann, S. Iftekhar, M. Star and P. O'Connor.

History

Volume

12

Issue

1

Start Page

1

End Page

45

Number of Pages

45

eISSN

1932-1473

ISSN

1932-1465

Publisher

Now Publishers, US

Peer Reviewed

Yes

Open Access

No

External Author Affiliations

University of Adelaide; The University of Western Australia; University of Alberta, Canada; University of Kiel, Germany

Era Eligible

Yes

Journal

International Review of Environmental and Resource Economics

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